Pradhan Mantri Ujjwala Yojana: Creases still have to be straightened out

Feb 06:
The Pradhan Mantri Ujjwala Yojana (PMUY) is expected to cover 8 crore poor households by 2019-20, according to the government8And yet an analysis shows that inclusion and exclusion errors of the Below Poverty Line targeting system have reduced the income effect of the PMUY8Only 48% of PMUY beneficiaries were among the poorest 40% of surveyed households.8Interestingly while women are targeted beneficiaries, in rural areas, fuel management responsibility transitions from women to men. The women-only approach has its own set of constraints, it has been found.8There is also extreme price sensitivity among these households. Almost 40% of the households would reduce consumption in case of a price hike and 14% would stop using LPG8Then again, large and inefficient PAHAL (DBTL) subsidies continue to represent a significant opportunity cost that could be better focused on supplementing energy access needs of poor households. In 2018, PAHAL (DBTL) subsidies were more than eight times the value of PMUY subsidies.8There is also a suggestion that a diverse, technology-neutral approach, with subsidies conditional on outcomes, may be more effective in terms of achieving access, avoiding technology lock-in and fostering affordable solutions.Click on Reports for more